Headlines

Bank of Scotland (Ireland) is to cease operating as a licensed bank in Ireland following a strategic review of its business here, The Irish Times reported. The company, which is owned by Lloyds Banking Group, will wind down its operations, ceasing to provide working capital and wealth management services by the end of the year, and transferring its existing Irish business to Bank of Scotland in the UK.

Greece's deepening recession is driving joblessness steadily higher, feeding discontent with the government's austerity program and dragging on the broader economy, The Wall Street Journal reported. Greece's gross domestic product contracted by 3.5% in the second quarter from a year earlier, hitting retailers hard and sending unemployment rates to above 12% of the work force, according to data released last week. Forecasts vary on just how bad unemployment could get. The International Monetary Fund predicts the jobless rate will reach 14.8% by 2012.

Pakistan is to ask the International Monetary Fund to ease restrictions on a $10bn loan it received in 2008 after concluding that the recent devastating floods had made the conditions attached to the lending programme impossible to meet, the Financial Times reported. Abdul Hafeez Shaikh, Pakistan’s finance minister, will travel to Washington next week to ask the IMF to restructure the current loan or consider new financing, according to Pakistani officials.

A bankruptcy judge issued a preliminary injunction shielding Compania Mexicana de Aviacion from creditors seeking to seize its U.S. assets, Dow Jones Daily Bankruptcy Review reported. Judge Martin Glenn of the U.S. Bankruptcy Court in Manhattan ruled in the Chapter 15 bankruptcy case of airline Mexicana's main unit for international flights. The case is a companion of the unit's main bankruptcy proceeding in Mexico.

New proposals published by the Financial Regulator last week will make it tougher for lenders to seek repossessions and will strengthen the rights of mortgage holders in arrears, InsolvencyJournal.ie reported. The planned changes are part of a proposed reform of the existing code of conduct for lenders and are aimed at easing the situation for more than 32,000 homeowners in arrears. Under the new rules, which are due to be finalised in November, lenders will have to explore all viable options with borrowers in arrears and examine alternative repayment measures.

A proposed direct factory outlet at Hobart Airport looks set to go ahead, even if the developer Austexx is placed in receivership, ABC News reported. There have been talks in Melbourne this week between Austexx and its lenders who, it's understood, are poised to place the debt-laden company into receivership. The company plans to build a $70 million DFO on land near Hobart Airport later this year. Hobart Airport's Brett Reiss says he is committed to the retail development and will seek an alternative developer if necessary.

German regulator Bafin closed noa bank GmbH & Co, a tiny Frankfurt-based retail lender focused on ethical and ecological banking, adding the bank was not systemically relevant, Reuters reported. Bafin ordered the closure as a way to "secure the assets", the regulator said. Noa bank was forbidden from making payments and taking deposits because the insolvency of its unit noa Factoring AG threatened to imperil the parent, Bafin said in a statement. Bafin said the bank had assets of 179.2 million euros ($231 million) on Aug.

More U.K. budget travel companies are facing insolvency after a combination of the economic downturn, volcanic ash, bad weather and strikes resulted in a sharp fall in holiday bookings this year, Dow Jones reported. Kiss Flights, which sold holidays to Greece, Egypt, Turkey and the Canary Islands, went into administration Tuesday, the seventeenth U.K. travel company protected by a customer protection scheme to go out of business this year, according to the Civil Aviation Authority. Another 33 companies under the same scheme failed last year.

Investment fund Advent International could invest some $49 million into Mexico's Mexicana de Aviacion to keep the airline flying, local media and a union said on Wednesday, Reuters reported. Pilots from Mexicana de Aviacion reached a preliminary deal this week that calls for wage cuts and staff reduction in a desperate bid to keep the 89-year-old airline operating, according to local media. Mexicana has halted more than a dozen international routes and stopped selling tickets after requesting creditor protection two weeks ago under Mexico's insolvency law, called concurso mercantil.

Airline Mexicana said Wednesday it is returning a quarter of its aircraft fleet to leasing companies and suspending some services offered by its low-cost and regional arms for the first time amid a deepening crisis at Mexico's largest carrier, Dow Jones Daily Bankruptcy Review reported. Compania Mexicana de Aviacion, the main unit for international flights, had already suspended some flights after filing for insolvency and bankruptcy protection on Aug. 2.